Netherlands: Investment Plan for Europe - ING and EIB provide EUR 110m for Spliethoff’s Green Shipping investments
28 February 2019
EUR 110.4 million loan for the installation of exhaust gas cleaning systems and ballast water management systems on 42 Spliethoff vessels part of EUR 300 million joint EIB-ING green shipping partnership.
EIB financing supported under EU’s “Juncker Plan” and “Connecting Europe Facility”.
ING and the European Investment Bank (EIB) today signed a EUR 110m loan agreement to finance Dutch ship management company Spliethoff’s Bevrachtingskantoor B.V. for the retrofitting of 42 vessels of its fleet with exhaust gas cleaning systems and ballast water management systems. This will enable Spliethoff to be compliant with International Maritime Organisation (IMO) and EU regulations governing air emissions and prevention of the release of seaborne pathogens that are harmful to the marine environment. The EIB loan will be supported by the European Fund for Strategic Investments (EFSI), the main pillar of the Investment Plan for Europe, as well as the “Connecting Europe Facility” (CEF).
The loan is part of the ING and EIB EUR 300m Green Shipping partnership signed in 2018, to support sponsors of green and sustainable projects in the maritime transport sector with advantageous financial terms. The EIB will contribute EUR 49.5 million to a EUR 110.4m ING Bank NV arranged facility to finance the installation of exhaust gas cleaning systems and ballast water management systems on 42 vessels for Spliethoff’s Bevrachtingskantoor B.V. In specific 17 vessels will be retrofitted with both exhaust gas cleaning systems and ballast water management systems, 5 vessels with exhaust gas cleaning systems and 20 vessels with ballast water management systems.
The retrofitted vessels will operate with significantly reduced emissions of sulphur oxide (SOx) and particulate matter (PM) pollutants and prevent the sea borne transfer of invasive species and diseases in ballast water.
EIB Vice-PresidentVazil Hudak stated: “Our joint programme with ING shows that greening the transport sector makes business sense, other than just being important for the environment. The support from the European Commission helps to make the maritime transport sector easier to finance for the Bank, a good example of cross-European teamwork.”
Michel Fransen, CFO of the Spliethoff Group said: We have been installing scrubbers on our fleet since 2013 and are very happy with the results so far. Scrubbers are a very environmentally friendly solution to comply with the 2020 regulations. LNG or hydrogen may have the potential to become even better alternatives in the future, but only in the longer term. The investment in scrubbers also safeguards the interest of our shareholders against uncertainties in fuel availability and pricing.
Stephen Fewster,GlobalHead of ING Shipping said: “Sustainability is an important strategic priority for ING. As a bank, we make the most impact through our financing. Therefore we are very proud to partner with the EIB to provide financing to Spliethoff to support their transition to a more sustainable business model while also meeting increasing environmental standards.”
Loyens & Loeff acted as transaction lawyer for ING Bank and coordinating documentation between all three parties.
This agreement forms part of ING’s wider sustainability strategy, which aims to facilitate and finance society’s shift to sustainability – environmental, economic, and social. As part of this, ING helps develop and promote sustainable business models and explore how sustainable financing can support energy transition and combat climate change.
The project will contribute to a modal shift in which, instead of by road, goods are transported by sea, which is considered the most sustainable transport mode for this type of cargo. This will help to reduce the overall climate impact of transport, and specifically the promoter’s carbon footprint.
The ING and EIB Partnership facility is available to clients with a significant European interest for projects that anticipate the construction of new vessels, or retro fitting of existing vessels, with a green innovation aspect and applies to both inland shipping and seagoing operators. This sector risk bearing facility is meant for projects that will improve the environmental performance of transport vessels in terms of diminishing the emission of pollutants as well as increasing fuel efficiency. Projects should be proposed to ING and will be subject to ING’s financial and non-financial risk acceptance criteria.
The EIB and ING today signed an agreement to support green investments for the European shipping market for a total value of EUR 300m. ING and EIB will each contribute EUR 150m to the facility. This agreement will ensure that sponsors of green and sustainable projects in the maritime transport sector can benefit from advantageous financial terms.
ING and the EIB are making EUR 400 million available for investments by business enterprises in the Netherlands, Belgium and Luxembourg. For businesses in these countries, the EIB’s involvement means that they benefit from a lower interest rate. Loans will specifically be focused on supporting business enterprises making investments in sustainable projects.
The EIB Group, consisting of EIB and EIF, has issued a guarantee to senior and mezzanine tranches backed by loans originated by ING to support new lending to Dutch SMEs and Mid-Caps, helping to mitigate the impact of Covid-19. Through a €795 million securitisation structure - the largest synthetic securitisation ever transacted by EIB Group - between EIF and EIB, with support from the Investment Plan for Europe, ING committed to make available new lending to SMEs and Mid-Caps during these difficult economic conditions for an amount in excess of €1.1 billion. Under agreements between ING and the EIB Group, favourable lending conditions will apply on €702 million of this total amount.